Resource Planning. Why does it not work? Part 1

The value of resource planning for an IT company is difficult to question. Many have resource plans. But really few people can boast of a really working resource planning system. Why so? Let's figure it out.

What is a truly working resource planning system?

Let's look at one of the most common models of a medium-sized company working on software development and more. Not grocery. Usually, in this we have:

• 20-50 existing projects for the development / implementation;
• 5-20 project managers (RP);
• 100-300 people in the development team (we include all employees who are directly involved in the development and implementation);
• 5-10 line / resource managers / department heads (RM);
• 2-5 employees of HR / recruiters (HR);
• 2-7 sales people, each of whom has from 3 to 6 potential projects (sales).

Then in a working system (simplified):

• RP regularly updates its resource plans, taking into account the fact that it has been worked out, and taking into account accepted change requests, staffing forecasts and risks;
• Sails regularly update the list and probabilities of concluding contracts for potential projects (presales), a preliminary assessment is made for each presale, a RP is assigned to each presale with a high probability of sale, which regularly updates resource plans for these presales;
• RM regularly analyze the composite picture of their resource pools, stafit empty positions in a short time, conducts active work with external resource pools, regularly updates the long-term need for resources and its profile;
• HR regularly receives from the RM a summary picture of both current and long-term resource requirements, from RPO (as an option) project priorities and, based on the information received, plans / updates training plans, selection plans, work plans with external resource pools.

Of course, behind each item on this list lies a large layer of work, daily responsibilities, internal and external communications, and a serious workflow. Each item is a topic for a separate article or training. However, if you imagine that all this and some other conditions are fulfilled, then a powerful and well-scalable business management tool appears in the company, where management always knows:

• the real picture with the utilization of resources (in a non-working system, many RPs hide resources in their replans and it’s hard to believe any analytics);
• a reliable forecast on the profitability of each project, program, company as a whole (in a non-working system, such a forecast is either not considered at all or is rarely updated, and if it is updated, then the cost of projects is usually overstated - there are many hours in the bones, which, for good, must be transferred to the project "doing nothing");
• real short-term and long-term need for resources and its profile - can plan the development of the company and budgets;
• that all projects prepared for signing are thoroughly analyzed and the company really knows how and from whom the project team will be formed, and will not launch another emergency upon signing;
• that people in the company are not overworked and working in optimal mode, the average cost of both internal and external hours is not overstated, the company does not overpay for resources;
• that the company can afford serious growth in team size, the number of projects, their size and complexity.

Of course, for the vast majority of companies, the above list is closer to science fiction than to the real state of things. And why?

As is usually the case?

Of course, there are a lot of factors that impede the work of the resource planning system. However, even if all the actors in the company correctly understand the whole scheme and goals of the interaction (take my word for it, even this is not common), often everything breaks / does not take off for a very simple reason. It's all about resource managers.

What is wrong with them, you ask? But let's figure it out. On the one hand, they should play a key role in the consolidation and validation, staffing of replans and planning of long-term selection needs for the HR service. On the other hand, it is resource managers who often work in the status of a “playing coach”.

If you’ve been in IT for a long time, you probably heard popular IT wisdom from the category of “a good developer makes a bad lead very quickly”, “it’s easy to get a bad tech manager from a good lead,” etc. The essence is the same everywhere - when moving an intelligent employee up the career ladder, it often happens that the employee does not have time to reorganize either by inertia or by the principle (how can I quit coding? I like it that way / my cost in the market will decrease) pays much time important in his opinion, but not characteristic of his current position activities.

Let's try to guess what in the recent past the architect / lead developer, and now the department head and owner of the internal resource pool, will make a choice:

• to find an urgent bug on the prod or update the consolidated replan?
• revise the code or analyze the results of the work of partners / external resource pools?
• Help write interesting and complex integration, or update a long-term resource need?
• to go to the customer’s site to launch a new version of the platform or to prepare the sale of temporarily idle internal resources?

And, moreover, if the company has the role of resource managers with the best analysts / developers / QA in the recent past, then who is most often thrown into the heat of a burning project? Well, of course, department heads / resource managers.

Of course, this can and should be done, but only for a short time and only in the form of large exceptions. But, as a great contemporary sang with a guitar:

What *** if not?

And this scenario, according to my observations, is just being implemented most often. A lot of companies operate in the emergency mode most of the time. Resource / functional managers are involved in one or several projects as leading developers / architects and other heroic heroes. And, as you can easily guess, our heroes simply do not have time left to fulfill their duties as a resource manager. For completely seemingly objective reasons. What do we have in the dry residue:

• sharply sags the quality of resource planning;
• HR-service ceases to understand what is happening and reduces the quality of selection;
• project managers start guerrilla wars among themselves and engage in open confrontations over resources;
• the number of conflicts over resources is rapidly increasing;
• part of the resources is multiply overloaded, part is “hidden” in fictitious replans for the future and is idle;
• the planning horizon of the combined resource requirements is reduced to 1-2 months or less;
• the company begins to plug holes by buying expensive external resources and paying regular overtime to emaciated employees;
• the emergency mode becomes the main operating mode of the company;
• the development of internal resource pools is remembered less and less;
• employees cease to consider such a company a comfortable place of work and lose their loyalty to it;
• shareholders do not receive their money.

I have thickened up a little here, but the vector of events is quite reliable.

What to do?

There is no universal recipe. Someone selects resource managers as a whole to work in the resource planning system (there is a risk that the manager will lose “connection with the land”), someone is trying to find the optimal balance with project activities (but here it must be remembered that with a shortage of time it’s the task of resource planning will be the first to go under the knife), someone puts assistants, etc. next to the resource manager, etc. The task is also complicated by the fact that:

• for the success of a resource planning system, many conditions must be met;
• there are no two identical resource planning systems.

One of the possible options for building a resource planning system is to launch an internal project to transform the company's management system, within which:

• the rules and principles of resource planning in a particular company will be formulated;
• Designed and spelled out the appropriate business processes;
• Performance metrics for each stage of the business process will be developed.
• measurements of the current values ​​of key metrics will be made;
• target values ​​of all metrics will be set;
• a decision will be made on the method and tools for automating resource planning processes;
• all key employees of the company (and not just project managers) will be familiarized with the rules and principles of resource planning and will be trained;
• changes will be made to the motivation system of participants in the resource planning system;
• regular monitoring of the quality of resource planning will be carried out, an analysis of the causes of deviations and the introduction of corrective actions into the system.

Obviously, the success of such a project will overwhelm the costs of its implementation in the first year. You can, of course, go in a smoother way, step by step making changes to the management system. Each approach has its pros and cons. But if you achieve your goal and make the resource planning system work correctly, then your company will simply move to another league.

Previous articles on resource planning:

Resource Planning. Part 1. What is it all about?

Resource Planning. Parts 2 and 3. Which depends on the resource plan. What determines the resource plan